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The pitfalls of DIY trade marks

There is growing awareness amongst small to medium enterprises (SMEs) that intellectual property (IP) protection is an important and necessary feature of any business plan. One of the most valuable IP rights that a business can own is a registered trade mark for protection of its brands and logos.

Consequently, there has been a significant increase in trade mark applications filed directly by business owners over the last few years. Most of these ‘self-filed’ applications are made without seeking professional advice.

Is neglecting to seek the assistance of a trade mark attorney turning out to be a false economy?

Several recent cases suggest that business owners can unwittingly find themselves with all sorts of problems which were not apparent when they took steps to register their own trade marks, leaving their business vulnerable to attack by third parties.

Some of these problems include:

not covering the goods and services for which the trade mark is actually used

finding that they have no entitlement to ownership of the trade mark registration

cancellation of the trade mark registration

The fact that these problems may arise many years after the trade mark has been registered does not reduce the impact on a business. The longer these problems go unnoticed, the greater the end cost to the business when these problems finally make themselves felt.

Typically, the business owner remains completely unaware that there is any problem until they receive a notice from IP Australia to advise that a third party has applied to remove their trade mark from the Trade Mark Register.

Incorrect goods and services

One such example was Phillip Ryan1, who registered the trade mark “PLAYER PROTECTION KEY” in 2004 for services in class 41 relating to gambling, lotteries, casino and entertainment services. Six year later, Racing and Wagering Western Australia applied for Mr Ryan’s trade mark registration to be removed from the register for non-use.

Mr Ryan argued that he had been using the trade mark to market and promote a USB device to identify and eliminate problem gamblers from poker machines, casinos, online gaming and gambling , wagering and lotteries.

What Mr Ryan failed to realise, however, was that the services listed on his trade mark registration were not consistent with how he was actually using the trade mark in practice. He was unable to provide any evidence that he had used PLAYER PROTECTION KEY in relation to gambling services or that he had intended at any time to offer the gambling services for which he had registered his trade mark.

His trade mark registration was struck off the Register seven years after he had registered it.

Incorrect owner

Registered trade marks can also be removed from the register if the wrong person is registered as the owner. For example2, in 1996, Michael Stafford registered the trade mark BLUEPRINT in relation to fuel system components, especially carburettor, fuel injection and ignition system components in the name of one of his businesses, Australian Carburettors and Fuel Injection. Sixteen years later, a British company applied to have the trade mark removed for non-use.

Mr Stafford argued that the BLUEPRINT trade mark had been used over the preceding sixteen years in relation to the goods listed on the registration by several of Mr Stafford’s companies and businesses. However, Australian Carburettors and Fuel Injection, the registered owner of the trade mark, had been cancelled from the Victorian Business Register in 1997. Therefore, it was not possible for Mr Stafford to demonstrate to the satisfaction of the Hearing Officer that the registered owner had used the trade mark because the registered owner no longer existed. The Hearing Officer held that the trade mark registration should be removed from the Trade Marks Register and the case is now under appeal.

Mr Stafford mistakenly believed that the title of the trade mark automatically reverted to him when the business name was cancelled. This case shows the unfortunate consequences of failing to understand the importance of registering the proper entity as the owner of the trade mark or recording changes to ownership of the trade mark when they occur.

This latter consideration is particularly important for mature businesses whose structure may have changed over the years. It is not unusual to find that these changes have not been updated in the Trade Marks Register, thereby leaving the registered trade mark vulnerable to challenge by third parties.

Will your Australian trade mark support an international brand protection strategy?

For those Australian businesses with export market ambitions, their Australian trade mark registrations have the potential to be the foundation of an international brand protection strategy. If the Australian trade mark registration has underlying flaws or offers inadequate protection, however, a global expansion plan can be seriously compromised.

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